According to court records from the Southern District of New York on September 5th, a federal judge issued an order to freeze certain bank accounts and assets, as well as prohibit any trading activities involving Alex Mashinsky, the former CEO of the now-bankrupt crypto lending company Celsius.
Previously, Alex Mashinsky was arrested on July 13th on multiple criminal and civil charges. Specifically, the U.S. Securities and Exchange Commission (SEC) accused Mashinsky and Celsius of defrauding investors, securities fraud, wire fraud, market manipulation of the CEL token, and money laundering.
Facing these legal allegations, the former CEO of Celsius vehemently denied the charges and promptly posted a $40 million bail to stay out of custody after his arrest. Additionally, Alex Mashinsky has vocally declared his intention to fight vigorously to protect his reputation and his contributions to the cryptocurrency space.
The arrest of Alex Mashinsky and the freezing of assets align with regulatory efforts to crack down on fraudulent behavior in the cryptocurrency industry.
As for Celsius, the crypto lending platform declared bankruptcy last year amidst a severe market downturn triggered by the Terra “black swan” event. Since then, Celsius has been working to raise funds to “rebound” and repay its debts. In July 2023, the court approved Celsius’s conversion of its held altcoins into Bitcoin (BTC) and Ethereum (ETH) as part of its efforts to stabilize its financial situation and exit bankruptcy.